For any broker active in the general insurance market it can be galling to turn the television on and see with unrelenting frequency a talking meerkat or a warbling opera singer.
The regularity of these advertisements promoting comparison websites indicates that the revenues generated more than justify the marketing spend .
So if this sustained marketing activity is here to stay and will affect the purchasing patterns of consumers, how should There appear to be distinct parallels between how brokers must act and how Andrew Harrison, chief executive officer of Carphone Warehouse, plans to distribute mobile phones.
In a recent article in The Times, Harrison stated that the next 12 months are going to be one of the most defining times the mobile phone industry has seen, and it’s a similar argument in the financial services market.
“We as a business have gone from strength to strength in the past 10 years, but against a background that anyone can sell a mobile phone,” he said in the article.
“We’re moving into an era of connectivity where it is about what the phone can do and explaining how we can make peoples’ lives better. That is not something you can buy off the shelf.”
The next 12 months will similarly dictate whether the comparison website juggernaut continues or whether brokers can regain lost market share by showing an increased desire to advise on GI.
Brokers who invest the time to define and deliver an advice process that consistently outlines policy features and benefits will have an advantage over their comparison site rivals.
People should compare what is covered to ensure it meets their requirements, and not just focus on price
Indeed, in the regulator’s review of insurance comparison sites led by Dan Waters, director of retail policy and conduct risk at the Financial Services Authority, he highlighted that it was imperative that all sites provide clear information so consumers could make informed decisions.
“People should compare what is covered by the policy to ensure it meets their requirements, and not just focus on price,” he said.
Many wholesale GI providers recognise how important it is to compete across all selection aspects, and have modified their propositions so advisers can quote with increased confidence, especially on a like-for-like cover basis.
Advisers should also take comfort that they are best placed to capitalise from the steer the FSA’s Moneymadeclear website offers to consumers who are searching for GI. Top tips on the website include:
- Read the paperwork and ask questions if you do not understand things.
- Ensure you check what you‘re covered or not covered for.
- Shop around when it comes to renewal time to ensure you‘re getting the best deal.
Brokers must seize the opportunity to provide clients with features-versus-benefits advice when it comes to GI.
Putting the brakes on the comparison site juggernaut will be a welcome result but I also believe that positively influencing purchasing behaviour for GI will delay the threat of consumers selecting larger commitment products via these sites. That seems a decent incentive.